World Bank Lends $104 million to Honduras

The government will allocate resources to strengthen tax administration and public finances.

Under the budgetary support provided through a US$86 million credit, the government is committed to strengthen the national public safety strategy, deepen the focus on prevention, and development of local efforts. It will include, for instance, the distribution of violence-prevention toolkits in at least 200 schools around the country, as well as the implementation of a comprehensive security plan in at least 10 municipalities in the country’s center, north and east. The Bank will also help build institutional capacities against money laundering and an improved database for crime and violence.

Furthermore, the credit contemplates technical assistance for macroeconomic and fiscal stability. Among its objectives is increasing the number of large taxpayers declaring taxes via the Internet by at least 20 percent.

As part of the Strategy, the Bank’s Board of Directors also approved a second credit to improve public sector performance, worth US$18.2 million. Those funds will help establish, among other goals, a more efficient, effective and transparent public bidding system, increasing the publication of bidding opportunities from 10 to 80 percent.

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The fiscal strengthening program seeks to increase the Salvadoran treasury’s balance and protect those resources earmarked for social programs.

It will be implemented by the Salvadoran Treasury Ministry over the next two years, and is composed of various elements, among them macroeconomic stability, tax reform, greater efficiency in tax and customs management and better use of subsidies.

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